Raha said the "economy appears to be in free fall." Unemployment - currently at 8.4 percent - is expected to reach 10 percent, and it looks like the recession will continue for the rest of this year, with the economy not gaining traction until the second half of 2010, Raha said.
There are some good signs though. Retail sales appear to have stabilized and housing prices seem to have bottomed out, Raha said. However, he qualified those findings by saying, "It is too early to tell if it's going to be sustained ... The outlook remains uncertain."
So with that in mind, state legislators are now staring down the barrel of a $9 billion budget deficit. That's about a $3 billion increase in the budget deficit since this year's legislative session began in January.
"It's time to roll up our sleeves," Sen. Joseph Zarelli, R-Ridgefield, said. "We didn't go near far enough" to make the cuts the legislature should have made to balance the budget, he said. "A big opportunity missed."
The problem today is half a billion dollars worse than the problem was yesterday, Rep. Ross Hunter, D-Medina, said. Balancing the budget, he said has to be done before legislators leave town. Under the state constitution, April 26 is the last regular session day.
So how will the legislature balance the budget? Certainly deep cuts will be in order, but what about a tax increase? When questioned this morning about a "revenue package," none of the legislators wanted to talk about it. Apparently there's been some chatter of a voter-approved tax increase in the halls of the capitol, but nobody has officially discussed the idea.
Gov. Chris Gregoire's budget director Victor Moore said that he and the governor are assuming the legislature will send them a balanced budget. Just how they are going to do that remains a mystery.